Samvat 2076: Sensex rallies 192 points, Nifty tops key 11,600 level

Mumbai: Investors and stock brokers looked forward to the new lunar year, or Samvat 2076, with a dash of optimism on Sunday, muhurat trading day. The Sensex opened up 339 points, or 0.8%, then pared some of its gains to close at 39,250, up 192 points, or 0.5%, in the special hourlong Diwali trading session. The Nifty gained 44 points, or 0.4%, to close at 11,628.


While a revival in corporate earnings is expected to take some time, monetary easing, along with the spurt in policy interventions over the past few months, will hold the key to sentiment in the new year, said market participants. That trend is expected to continue.


“I am optimistic about the medium to long-term perspective as I see tremendous interest among the foreign investors,” said Motilal Oswal, managing director and CEO, Motilal Oswal Financial Services. “The government is also proactively addressing many basic issues. After the big bang corporate tax cut, I am hopeful that there will be individual income tax rate cuts and see many more reforms on the way.”

Considered an auspicious occasion, traders following the lunar financial year opened accounts for the new year with a 60-minute trading session. A large number of brokers, traders and their family members were present at the customary muhurat trading function held at the BSE’s iconic Phiroze Jeejeebhoy Towers.

Tata Motors Biggest Gainer

Tata Motors, which announced on Friday that its promoter Tata Sons will infuse Rs 6,500 crore into the company as part of a Rs 10,000-crore fundraising by the automaker, was the biggest gainer among BSE A group stocks with a 17% gain. The gain was the most in a decade for the company during the special Diwali trading session.

Given the tough economic environment, markets could remain under pressure in Samvat 2076. However, structural changes such as corporate tax cuts, interest rate cuts and other measures to boost investor confidence will revive growth over a period of time, said experts.

“The worst is behind us in terms of the economic slowdown and I believe the situation will get better with the slew of measures announced by the government recently to provide growth stimulus,” said IIFL Group chairman Nirmal Jain. “There is adequate domestic and foreign liquidity available for good companies.”

Barring the telecom index, all other sectoral indices on the BSE ended in the green during the muhurat session. The auto and industrial indexes gained 1.5% and 1.6%, respectively, while the IT, metal, capital goods and basic materials indexes were up over 0.50%.

Samvat 2075 was an eventful year marked by a local and global economic slowdown, along with stress in the financial sector. The Nifty ended Samvat 2075 with gains of 9.5%, helped by the corporate tax cuts, which led to a rally of 9% in two trading sessions. But the broader market underperformed, with the BSE Midcap and BSE Smallcap indexes down by 3.4% and 9.8%, respectively, over the same period.

Since the Infrastructure Leasing & Financial Services (IL&FS) default in September 2018, non-banking finance companies (NBFCs) have been squeezed by a liquidity crunch. Many leveraged companies have become an area of concern for the banking sector. Overall economic parameters have slumped with GDP estimates being revised downward. In this context, earnings again saw continuous downgrades and hopes of recovery got pushed back further, as has been the case for almost a decade now.

The market will focus on the next set of earnings announcements this week after the Diwali break on Monday, when the stock market will be closed.

A consumption uptick and external factors could augur well for the future. “On a longterm perspective, attractive schemes for consumers, boost from festive season and accommodative factors like fall in oil prices to provide positive momentum for Indian equity market,” said Vinod Nair, head of research at Geojit Financial Services.